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CNH dealers hit out as firm's strategy changes

PLANT - Distributors complain of low morale following manufacturer's personnel and policy changes

PLANT manufacturer CNH is facing a crisis of confidence from its European distributors.

Dealers for its New Holland and Case brands are up in arms about the firm's strategic and management changes.

The manufacturer is in talks with some of the largest dealers, disillusioned with the current set-up, in a bid to persuade them not to defect to rival manufacturers.

British dealers in particular have expressed dismay at the frequent changes of CNH personnel and called on the firm to take a more pragmatic approach to stiff competition in the UK market.

In turn CNH's management has called on dealers to keep faith, promising that it will work with them more closely as it strives to rebuild market share.

The US-Italian manufacturer has been through turbulent times since it was created by the merger of Case and New Holland in 1998. As well as a major rationalising of production capacity, the firm has had to renegotiate its European joint venture, replacing Hitachi with Kobelco. And in the past two years the manufacturer has merged a number of product lines, including Kobelco, O&K and Fiat-Kobelco, into two brands, Case and New Holland.

Finally, last October CNH separated the management streams of each brand, a move which was accompanied by a number of changes of local management, including New Holland manager Paul Hoptroft, who left the company in December.

According to the dealers, such frequent changes have caused confidence to fall. One of New Holland's 12 UK dealers said: 'Morale is low since the last lot of changes. We have calculated that we have seen 14 different managers in the past three years.' In response, the manufacturer said it wanted to work more closely with individual dealers, but that the partnership must work both ways.

New Holland territory manager Giancarlo Fulchieri said: 'The restructuring has been a tough process, but we are not expecting to change things overnight. We don't want to lose any dealers to rivals.

'I am ready to go to every single dealer to see what we can do and to sign key account managers so we can work alongside them with the big customers.

We currently have a market share of about 4 per cent and I believe we can double that in three years.' Dealers have warned that UK pricing needs to be closely looked at if they are to hold their own.

One dealer said: 'We are going to struggle to gain share at current levels.

The UK is hugely competitive and it should be treated as a special case, with dealers given more flexibility.

'It is not just in the UK. There are dealers in northern Europe who feel the same: they are not happy with the support. The senior CNH management in the USA needs to realise that.' Mr Fulchieri replied: 'We are not going to be 100 per cent competitive on all products, but we will look at six or seven key lines.

'With the truck market we have proved that you can maintain the price even if the product is not the marketleader; but in construction we have a very good product.'